Vietnam cuts LNG import tariff to boost clean energy transition

By Vietnam News Agency
Fri, May 2, 2025 | 3:26 pm GMT+7

The Vietnamese Government has reduced the preferential import tariff on LNG from 5% to 2% under a decree issued on March 31, which marks a key step in accelerating the country’s shift from fossil fuels to cleaner energy.

LNG import operations at Thi Vai terminal. Photo courtesy of Vietnam News Agency.

LNG import operations at Thi Vai terminal. Photo courtesy of Vietnam News Agency.

Boost for LNG investors

Nguyen Quoc Thap, chairman of the Vietnam Petroleum Association, said the lower tariff would provide strong incentives for investors in the LNG value chain, from importers like PV Gas to power producers such as PV Power and end users.

The decision, under Decree No. 73/2025/ND-CP, also signals the Government’s intent to refine energy policy by balancing the interests of the State, investors, and consumers.

A more investor-friendly framework is expected to encourage development of LNG infrastructure, including terminals, storage, regasification facilities, and LNG-fuelled power plants.

Under the Power Development Plan VIII, Vietnam aims to build 23 gas-fired power projects by 2030, of which 10 using domestic gas, with total capacity of 7,900 MW, and 13 relying on imported LNG, with a combined capacity of 22,400 MW.

These projects will play a vital role in increasing national power supply and advancing Vietnam’s 2050 net-zero emissions target.

The Nhon Trach 3 Power Plant, the first LNG-to-power plant using imported gas, was connected to the national grid in February and is set to begin commercial operations in July. Developed by PV Power, a Petrovietnam subsidiary, its workload saw 96% completed along with the Nhon Trach 4 plant.

Both are expected to be fully operational in 2025.To ensure stable long-term fuel supply, PV Gas and PV Power have signed a 25-year LNG supply agreement for the Nhon Trach 3 and 4 plants.

As domestic gas reserves decline, PV Gas, currently Vietnam’s only long-term LNG supplier, is accelerating investment in import terminals to maintain supply for both electricity generation and industry. The tariff cut is expected to help lower input costs for LNG power and benefit consumers.

Policy gaps remain

While the tariff reduction is a welcome step, more comprehensive reforms are needed, said Thap. A unified regulatory framework covering investment, infrastructure, imports, and LNG trading is essential to achieve national energy security and long-term sustainability goals.

Echoing this, a PV Gas representative pointed to persistent policy challenges, such as the absence of a guaranteed purchase volume, unclear rules for passing LNG prices through to electricity prices, and vague cost regulations.

These hurdles complicate project planning, output pricing, and commercial negotiations throughout the LNG value chain. PV Power also highlighted difficulties in accessing international financing, as imported LNG remains a new investment model in Vietnam.

To secure foreign loans, projects typically need minimum purchase guarantees (70-80%), a price pass-through mechanism similar to that for domestic gas, and clear access to land and transmission infrastructure.

Petrovietnam also stressed that LNG-to-power should not be treated like traditional power sources in the competitive electricity market, as long-term LNG contracts are needed to ensure stable supply and reduce costs.

Legal reforms to support energy transition

To advance clean energy goals, the Vietnam Petroleum Association has called for revisions to a wide range of laws, including those on electricity, environmental protection (especially carbon emissions accounting), taxation, marine resources, investment, procurement, construction, and land.

It also recommends aligning electricity market development with Power Development Plan VIII, building integrated LNG infrastructure clusters (terminals, power plants, and industrial zones), and expanding transmission networks for both domestic use and export -particularly for LNG-based power.

The association further urged updates to the organizational and financial regulations for state-owned energy firms like Petrovietnam and EVN.

Comments (0)
  • Read More
Vietnam races against time to have EC’s 'yellow card' lifted before Sept 15

Vietnam races against time to have EC’s 'yellow card' lifted before Sept 15

Vietnam's Ministry of Agriculture and Environment has proposed Prime Minister Pham Minh Chinh issue an action plan to address the European Commission's (EC) “yellow card” warning and prepare for the fifth EC inspection.

Southeast Asia - Fri, May 2, 2025 | 3:21 pm GMT+7

Vietnam's property market sees mixed prospects in Q2: analysts

Vietnam's property market sees mixed prospects in Q2: analysts

Vietnam’s real estate market is expected to see positive developments in Q2, with developers launching new projects, but uncertainties from U.S. trade policies may influence market sentiment and consumer confidence, said analysts.

Real Estate - Fri, May 2, 2025 | 3:14 pm GMT+7

Vietnam’s largest container fleet operator records 478% profit growth in Q1 on surging shipping rates

Vietnam’s largest container fleet operator records 478% profit growth in Q1 on surging shipping rates

Vietnam’s Hai An Transport and Stevedoring JSC (HAH) reported after-tax profit of nearly VND274 billion ($10.54 million) in Q1/2025, skyrocketing 478% year-on-year, thanks to soaring shipping rates.

Companies - Fri, May 2, 2025 | 3:00 pm GMT+7

Vietnam's leading construction contractor Hoa Binh targets US market amid low domestic profit

Vietnam's leading construction contractor Hoa Binh targets US market amid low domestic profit

Hoa Binh Construction Group, one of Vietnam's top contractors, is negotiating a joint venture agreement with American partners to pave the way for implementing major projects in the U.S.

Companies - Fri, May 2, 2025 | 2:04 pm GMT+7

Northern Vietnam province Hai Duong to have first urban area-golf course complex

Northern Vietnam province Hai Duong to have first urban area-golf course complex

Hai Duong province's authorities have granted in-principle approval for the Lien Hong New Urban Area and Golf Course project, with a total investment of VND11 trillion ($423 million).

Real Estate - Fri, May 2, 2025 | 9:59 am GMT+7

Central Vietnam 'awakened' by major resort projects

Central Vietnam 'awakened' by major resort projects

From once-abandoned coastal lands to emerging resort-urban areas, central Vietnam is witnessing a strong resurgence of investment.

Real Estate - Fri, May 2, 2025 | 9:22 am GMT+7

Vietnam Airlines posts strong profit on international passenger surge, fuel price decline

Vietnam Airlines posts strong profit on international passenger surge, fuel price decline

National flag carrier Vietnam Airlines (HVN) said on Wednesday that it recorded consolidated pre-tax profit of around VND3.6 trillion ($138 million) on consolidated revenue of approximately VND31.1 trillion ($1.2 billion) in Q1/2025.

Companies - Fri, May 2, 2025 | 8:17 am GMT+7

S Korean firms pledge nearly $2 bln in new investments in Indonesia

S Korean firms pledge nearly $2 bln in new investments in Indonesia

South Korea's companies will increase their investment in Indonesia by $1.7 billion, Indonesian Economic Minister Airlangga Hartarto said on Monday after attending a meeting between a Korean business association and President Prabowo Subianto.

Southeast Asia - Thu, May 1, 2025 | 10:01 pm GMT+7

Malaysia develops sustainable semiconductor ecosystem

Malaysia develops sustainable semiconductor ecosystem

The Malaysian Investment Development Authority (MIDA), the Federation of Malaysian Manufacturing (FMM), and Bintang Capital Partners (Bintang Capital) on Monday announced a landmark MoU signed recently regarding the establishment of Bintang Semiconductor Impact Fund I (BSIF I).

Southeast Asia - Thu, May 1, 2025 | 9:59 pm GMT+7

Vietnam to become second-largest economy in Southeast Asia by 2036: CEBR

Vietnam to become second-largest economy in Southeast Asia by 2036: CEBR

The Centre for Economic and Business Research (CEBR), in its report World Economic League Table 2022, forecasts that Vietnam will become the second-largest economy in Southeast Asia after Indonesia and the 20th-largest economy in the world by 2036.

Southeast Asia - Thu, May 1, 2025 | 9:42 pm GMT+7

Vietnam conglomerate Vingroup's Q1 revenue surpasses $3 bln for first time

Vietnam conglomerate Vingroup's Q1 revenue surpasses $3 bln for first time

Vingroup, Vietnam's leading private conglomerate, recorded revenue of VND84.05 trillion ($3.3 billion) in the first quarter of 2025, its record high.

Companies - Thu, May 1, 2025 | 3:44 pm GMT+7

Work starts on expressway connecting Vietnam's Central Highlands with southeastern region

Work starts on expressway connecting Vietnam's Central Highlands with southeastern region

Construction on Tuesday began on the first component of Gia Nghia town (the Central Highlands province of Dak Nong)-Chon Thanh town (the southeastern province of Binh Phuoc) section of the North-South Expressway.

Infrastructure - Thu, May 1, 2025 | 2:46 pm GMT+7

Final sections of central Vietnam’s longest sea-crossing bridge joined

Final sections of central Vietnam’s longest sea-crossing bridge joined

Authorities of Hue city in central Vietnam on Wednesday held a ceremony to celebrate the joining of the final sections of Thuan An sea-crossing bridge, a landmark infrastructure project with significant implications for local development and tourism.

Infrastructure - Thu, May 1, 2025 | 2:35 pm GMT+7

Lach Huyen port will achieve 70% of year's target in worst-case scenario: exec

Lach Huyen port will achieve 70% of year's target in worst-case scenario: exec

Lach Huyen deep-water port, the largest of its kind in northern Vietnam, would see its cargo volume decline by 30-50% if the U.S. maintains its 46% reciprocal tariff on Vietnam and the U.S.-China trade tensions escalate, said CEO of Port of Hai Phong JSC (Hai Phong Port) Nguyen Tuong Anh.

Companies - Thu, May 1, 2025 | 12:24 pm GMT+7

Taiwan electronics firm Lite-On to invest extra $25 mln for expansion in Vietnam

Taiwan electronics firm Lite-On to invest extra $25 mln for expansion in Vietnam

Taiwan-based Lite-On Technology Corporation, a world leader in optoelectronics and power management solutions, will invest an additional $25 million in Vietnam as part of its expansion plan in the Southeast Asian country.

Industries - Thu, May 1, 2025 | 12:13 pm GMT+7

Petrovietnam on track to restart $1.5 bln thermal power plant project in southern Vietnam

Petrovietnam on track to restart $1.5 bln thermal power plant project in southern Vietnam

State-owned energy giant Petrovietnam is on track to resume the Long Phu 1 thermal power project, located in the Mekong Delta province of Soc Trang, after six years of suspension.

Energy - Thu, May 1, 2025 | 12:10 pm GMT+7